Now that the current liabilities have been completed for the audit, the audit senior has asked you to review the long-term liabilities for any potential issues. After reviewing the long-term liability documents, you noticed the following potential issues need to be addressed:• On January 1, 2008, Hogg issued $10,000,000 in 20-year, 7-percent bonds at 97 that were not recorded. Interest was paid semiannually on July 1 and January 1.• Hogg purchased new equipment by issuing a five-year zero-interest-bearing note, with a face value of $1,000,000. Hogg’s typical rate of borrowing for these notes is 5 percent. The note and the equipment were recorded at face value.• Hogg currently owns 30 percent of Piggy Company and is considering buying the additional 21 percent to get control of the company. However, Piggy Company has a considerable amount of debt on their books with an 80 percent debt-to-asset (DTA) ratio.Write a half-page report to the ownership of Hogg with your recommendation regarding the purchase of Piggy Company. Be sure to support your position.In addition, you will deal with Hogg’s issuance of bonds by preparing all necessary schedules and journal entries related to the issuance and first-year accounting for the bonds.Also, analyze and record the issuance of a note exchanged for property. Explore the potential of off-balance-sheet debt and update the log of issues to include this week’s topics.

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